Grant help for middle income families

Thousands more students will be eligible for grants towards university living costs as part of a £400 million package of support announced yesterday.

The parental earnings limit will be raised to £60,000 enabling many more middle class students to qualify for the subsidy which will range from £100 at the upper end to the full £2,825 a year for those from families earning less than £25,000, up from the present £17,500 limit.

John Denham, the new Universities Secretary, in his first statement to the Commons, promised that 50,000 more students would qualify for a full grant when the changes are implemented next year.

The announcement was seen as Gordon Brown's gesture to the Labour backbench rebels who campaigned against the introduction of the £3,000 a year top-up fees that universities have been able to charge from last September.

Related Articles

Mr Brown said the extra financial support would help even more young people fulfil their ambitions for a university education.

"No one should be held back from realising their potential by fear that they will not be able to afford to go to university or that they will graduate with unmanageable levels of debt," he said.

The package, costing £400 million, will make 100,000 extra students entitled to a partial grant, of which around 80,000 will get an extra amount of up to £250, 87,000 between £750 and £1,000, and 35,000 more than £1,000 once the system is fully implemented in 2010. A third of students will get a full grant, compared with 29 per cent at present and a further third will be able to claim a partial grant, up from 22 per cent.

A student from a household on £25,000-a-year earnings will get £2,825, an extra £1,100 a year in maintenance grant and those with family incomes of £40,000 will get a grant for the first time, receiving £1,010.

Higher income students will also be allowed to borrow more to finance living costs.

Bill Rammell, the higher education minister, said it was a recognition that an income of £60,000, particularly in areas of high property prices, did not put people into the highly affluent bracket. It was also announced that all those 16-year-olds who qualify for an education maintenance allowance will be given a firm guarantee of the amount of financial support they will receive if they choose to go on to higher education.

"This will ensure potential university students know at an early stage what financial support they can expect, and dispel misconceived fears on the cost of studying at college or university," Mr Rammell said.

A new "re-payment holiday" was also announced allowing graduates to take a break of up to five years from their loan repayments to help meet the cost of buying a home or starting a family.